In the United Kingdom you can purchase cars and sometimes furniture and white goods on a hire purchase or conditional sales agreement.  These agreements are not like conventional credit loans in that you do not own the property until the entire agreement is paid off.  Which means if you are in debt and have to file bankruptcy or for an IVA you cannot sell the property unless the creditor gives you express written permission to do so.  Without written permission from the creditor you are looking at a criminal offence if you sell the items. 

Additionally with a hire purchase agreement the creditor has the right to repossess the property if you do not make your payments regularly or on time.  Ordinary credit agreements do not allow the creditors to take back the property.  They can only ask for the money you owe on the agreement itself.  If you are unsure whether you have a hire purchase, conditional sale agreement or regular credit line, ask your lender or check the contract that you signed to find out for certain. 

Your agreement will outline for you your rights if you cannot pay the bill.  It will tell you how much you will need to pay to stop your creditor from repossessing the goods without a court order or your consent, and it is usually a third of the total amount payable under the agreement.  If you have paid a third of the overall agreement prior to becoming unable to make your payments, your property is considered 'protected goods' and the creditor must go to court and get a court order before they can come and repossess the goods or they must have your consent to take the items.  They simply cannot come and take the property away.  Remember to include any deposits of part exchanges that you may have made when you try to determine whether or not you have paid a third on the goods.  If the creditor 'snatches back' the goods without a court order or your consent and you have paid a third or more and can prove it, you are entitled to a refund of all of the money you paid under the agreement. 

Remember, your creditor has to go to court and get a court order in order to repossess your goods.  They will have to file a return order, and a hearing with the district judge will be scheduled.  You will be notified of the hearing, and you have 14 days to return the notification in order for the courts to suspend the creditor from getting the good back.  If you can pay the debt back in reasonable installments - usually less than the actual payment you are having trouble with - the courts may deny the return order and allow you to keep the property if you have paid off a third or more of the overall agreement. 

If you have not paid a third of the total amount of the agreement and the creditor requests the goods, it is a good idea to contact the creditor and ask them to work out a payment arrangement with you that is agreeable to you both.  They may be willing to reduce the payments for a short period of time or allow you to make full monthly installments with something extra that is applied towards the arrears on the bill.